AMENDED AND RESTATED
INVESTMENT ADVISORY AGREEMENT
AMENDED AND RESTATED AGREEMENT made as of the 1st day of January, 2005,
by and between OPPENHEIMER MAIN STREET FUNDS, INC. (hereinafter referred to
as the "Corporation"), and OPPENHEIMERFUNDS, INC. (hereinafter referred to as
"OFI").
WHEREAS, the Corporation is an open-end, non-diversified series
management investment company registered as such with the Securities and
Exchange Commission (the "Commission") pursuant to the Investment Company Act
of 1940 (the "Investment Company Act"), and OFI is a registered investment
adviser; and
WHEREAS, XXXXXXXXXXX MAIN STREET FUND (the "Fund") is a series of the
Corporation having a separate portfolio, investment policies and investment
restrictions;
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter set forth, it is agreed by and between the parties, as follows:
1. General Provisions.
The Corporation hereby employs OFI and OFI hereby undertakes to act as
the investment adviser of the Fund and to perform for the Fund such other
duties and functions as are hereinafter set forth. OFI shall, in all
matters, give to the Fund and the Corporation's Board of Directors the
benefit of its best judgment, effort, advice and recommendations and shall,
at all times conform to, and use its best efforts to enable the Fund to
conform to: (i) the provisions of the Investment Company Act and any rules or
regulations thereunder; (ii) any other applicable provisions of state or
federal law; (iii) the provisions of the Articles of Incorporation and
By-Laws of the Corporation as amended from time to time; (iv) policies and
determinations of the Board of Directors of the Corporation; (v) the
fundamental policies and investment restrictions of the Fund as reflected in
the Corporation's registration statement under the Investment Company Act or
as such policies may, from time to time, be amended by the Fund's
shareholders; and (vi) the Prospectus and Statement of Additional Information
of the Corporation in effect from time to time. The appropriate officers and
employees of OFI shall be available upon reasonable notice for consultation
with any of the Directors and officers of the Corporation with respect to any
matters dealing with the business and affairs of the Corporation including
the valuation of portfolio securities of the Fund which securities are either
not registered for public sale or not traded on any securities market.
2. Investment Management.
(a) OFI shall, subject to the direction and control by the
Corporation's Board of Directors, (i) regularly provide investment advice and
recommendations to the Fund with respect to its investments, investment
policies and the purchase and sale of securities; (ii) supervise continuously
the investment program of the Fund and the composition of its portfolio and
determine what securities shall be purchased or sold by the Fund; and (iii)
arrange, subject to the provisions of paragraph 7 hereof, for the purchase of
securities and other investments for the Fund and the sale of securities and
other investments held in the portfolio of the Fund.
(b) Provided that the Corporation shall not be required to pay any
compensation other than as provided by the terms of this Agreement and
subject to the provisions of paragraph 7 hereof, OFI may obtain investment
information, research or assistance from any other person, firm or
corporation to supplement, update or otherwise improve its investment
management services.
(c) Provided that nothing herein shall be deemed to protect OFI from
willful misfeasance, bad faith or gross negligence in the performance of its
duties, or reckless disregard of its obligations and duties under this
Agreement, OFI shall not be liable for any loss sustained by reason of good
faith errors or omissions in connection with any matters to which this
Agreement relates.
(d) Nothing in this Agreement shall prevent OFI or any officer
thereof from acting as investment adviser for any other person, firm or
corporation and shall not in any way limit or restrict OFI or any of its
directors, officers, stockholders or employees from buying, selling or
trading any securities for its or their own account or for the account of
others for whom it or they may be acting, provided that such activities will
not adversely affect or otherwise impair the performance by OFI of its duties
and obligations under this Agreement.
3. Other Duties of OFI.
OFI shall, at its own expense, provide and supervise the activities of
all administrative and clerical personnel as shall be required to provide
effective corporate administration for the Fund, including the compilation
and maintenance of such records with respect to its operations as may
reasonably be required; the preparation and filing of such reports with
respect thereto as shall be required by the Commission; composition of
periodic reports with respect to operations of the Fund for its shareholders;
composition of proxy materials for meetings of the Fund's shareholders; and
the composition of such registration statements as may be required by Federal
and state securities laws for continuous public sale of shares of the Fund.
OFI shall, at its own cost and expense, also provide the Fund with adequate
office space, facilities and equipment. OFI shall, at its own expense,
provide such officers for the Corporation as the Corporation's Board may
request.
4. Allocation of Expenses.
All other costs and expenses of the Fund not expressly assumed by OFI
under this Agreement, or to be paid by the General Distributor of the shares
of the Fund, shall be paid by the Corporation, including, but not limited to:
(i) interest and taxes; (ii) brokerage commissions; (iii) insurance premiums
for fidelity and other coverage requisite to its operations; (iv)
compensation and expenses of its directors other than those associated or
affiliated with OFI; (v) legal and audit expenses; (vi) custodian and
transfer agent fees and expenses; (vii) expenses incident to the redemption
of its shares; (viii) expenses incident to the issuance of its shares against
payment therefor by or on behalf of the subscribers thereto; (ix) fees and
expenses, other than as hereinabove provided, incident to the registration
under Federal and state securities laws of shares of the Fund for public
sale; (x) expenses of printing and mailing reports, notices and proxy
materials to shareholders of the Fund; (xi) except as noted above, all other
expenses incidental to holding meetings of the Fund's shareholders; and (xii)
such extraordinary non-recurring expenses as may arise, including litigation,
affecting the Fund and any legal obligation which the Corporation may have
(on behalf of the Fund) to indemnify its officers and directors with respect
thereto. Any officers or employees of OFI or any entity controlling,
controlled by or under common control with OFI, who may also serve as
officers, directors or employees of the Corporation shall not receive any
compensation from the Corporation for their services. The expenses with
respect to any two or more series of the Corporation shall be allocated in
proportion to the net assets of the respective series except where
allocations of direct expenses can be made.
5. Compensation of OFI.
The Corporation agrees to pay OFI on behalf of the Fund and OFI agrees
to accept as full compensation for the performance of all functions and
duties on its part to be performed pursuant to the provisions hereof, a fee
computed on the aggregate net asset value of the Fund as of the close of each
business day and payable monthly at the annual rate of 0.65% of the first
$200 million of net assets, 0.60% of the next $150 million, 0.55% of the next
$150 million and 0.45% of net assets in excess of $500 million.
6. Use of Name "Main Street."
OFI hereby grants to the Corporation a royalty-free, non-exclusive
license to use the name "Main Street" in the name of the Corporation and the
Fund for the duration of this Agreement and any extensions or renewals
thereof. To the extent necessary to protect OFI's rights to the name "Main
Street" under applicable law, such license shall allow OFI to inspect and,
subject to control by the Corporation's Board, control the nature and quality
of services offered by the Corporation under such name. Such license may,
upon termination of this Agreement, be terminated by OFI, in which event the
Corporation shall promptly take whatever action may be necessary to change
its name and the name of the Fund and discontinue any further use of the name
"Main Street" in the name of the Corporation or the Fund or otherwise. The
name "Main Street" may be used or licensed by OFI in connection with any of
its activities, or licensed by OFI to any other party.
7. Portfolio Transactions and Brokerage.
(a) OFI is authorized, in arranging the purchase and sale of the
Fund's portfolio securities, to employ or deal with such members of
securities or commodities exchanges, brokers or dealers (hereinafter
"broker-dealers"), including "affiliated" broker-dealers (as that term is
defined in the Investment Company Act), as may, in its best judgment,
implement the policy of the Fund to obtain, at reasonable expense, the "best
execution" (prompt and reliable execution at the most favorable security
price obtainable) of the Fund's portfolio transactions as well as to obtain,
consistent with the provisions of subparagraph (c) of this paragraph 7, the
benefit of such investment information or research as will be of significant
assistance to the performance by OFI of its investment management functions.
(b) OFI shall select broker-dealers to effect the Fund's portfolio
transactions on the basis of its estimate of their ability to obtain best
execution of particular and related portfolio transactions. The abilities of
a broker-dealer to obtain best execution of particular portfolio
transaction(s) will be judged by OFI on the basis of all relevant factors and
considerations including, insofar as feasible, the execution capabilities
required by the transaction or transactions; the ability and willingness of
the broker-dealer to facilitate the Fund's portfolio transactions by
participating therein for its own account; the importance to the Fund of
speed, efficiency or confidentiality; the broker-dealer's apparent
familiarity with sources from or to whom particular securities might be
purchased or sold; as well as any other matters relevant to the selection of
a broker-dealer for particular and related transactions of the Fund.
(c) OFI shall have discretion, in the interests of the Fund, to
allocate brokerage on the Fund's portfolio transactions to broker-dealers,
other than an affiliated broker-dealer, qualified to obtain best execution of
such transactions who provide brokerage and/or research services (as such
services are defined in Section 28(e)(3) of the Securities Exchange Act of
1934) for the Fund and/or other accounts for which OFI or its affiliates
exercise "investment discretion" (as that term is defined in Section 3(a)(35)
of the Securities Exchange Act of 1934) and to cause the Corporation to pay
such broker-dealers a commission for effecting a portfolio transaction for
the Fund that is in excess of the amount of commission another broker-dealer
adequately qualified to effect such transaction would have charged for
effecting that transaction, if OFI determines, in good faith, that such
commission is reasonable in relation to the value of the brokerage and/or
research services provided by such broker-dealer, viewed in terms of either
that particular transaction or the overall responsibilities of OFI or its
affiliates with respect to the accounts as to which they exercise investment
discretion. In reaching such determination, OFI will not be required to
place or attempt to place a specific dollar value on the brokerage and/or
research services provided or being provided by such broker-dealer. In
demonstrating that such determinations were made in good faith, OFI shall be
prepared to show that all commissions were allocated for purposes
contemplated by this Agreement and that the total commissions paid by the
Corporation over a representative period selected by the Corporation's
directors were reasonable in relation to the benefits to the Fund.
(d) OFI shall have no duty or obligation to seek advance competitive
bidding for the most favorable commission rate applicable to any particular
portfolio transactions or to select any broker-dealer on the basis of its
purported or "posted" commission rate but will, to the best of its ability,
endeavor to be aware of the current level of the charges of eligible
broker-dealers and to minimize the expense incurred by the Fund for effecting
its portfolio transactions to the extent consistent with the interests and
policies of the Fund as established by the determinations of the Board of
Directors of the Corporation and the provisions of this paragraph 7.
(e) The Corporation recognizes that an affiliated broker-dealer: (i)
may act as one of the Fund's regular brokers so long as it is lawful for it
so to act; (ii) may be a major recipient of brokerage commissions paid by the
Corporation; and (iii) may effect portfolio transactions for the Fund only if
the commissions, fees or other remuneration received or to be received by it
are determined in accordance with procedures contemplated by any rule,
regulation or order adopted under the Investment Company Act for determining
the permissible level of such commissions.
8. Duration.
This Agreement will take effect on the date first set forth above.
Unless earlier terminated pursuant to paragraph 9 hereof, this Agreement
shall remain in effect until two years from the date of execution hereof, and
thereafter will continue in effect from year to year, so long as such
continuance shall be approved at least annually by the Corporation's Board of
Directors, including the vote of the majority of the Directors of the
Corporation who are not parties to this Agreement or "interested persons" (as
defined in the Investment Company Act) of any such party, cast in person at a
meeting called for the purpose of voting on such approval, or by the holders
of a "majority" (as defined in the Investment Company Act) of the outstanding
voting securities of the Fund and by such a vote of the Corporation's Board
of Directors.
9. Termination.
This Agreement may be terminated: (i) by OFI at any time without
penalty upon sixty days' written notice to the Corporation (which notice may
be waived by the Corporation); or (ii) by the Corporation at any time without
penalty upon sixty days' written notice to OFI (which notice may be waived by
OFI) provided that such termination by the Corporation shall be directed or
approved by the vote of a majority of all of the directors of the Corporation
then in office or by the vote of the holders of a "majority" of the
outstanding voting securities of the Fund (as defined in the Investment
Company Act).
10. Assignment or Amendment.
This Agreement may not be amended or the rights of OFI hereunder sold,
transferred, pledged or otherwise in any manner encumbered without the
affirmative vote or written consent of the holders of the "majority" of the
outstanding voting securities of the Fund. This Agreement shall
automatically and immediately terminate in the event of its "assignment," as
defined in the Investment Company Act.
11. Definitions.
The terms and provisions of this Agreement shall be interpreted and
defined in a manner consistent with the provisions and definitions of the
Investment Company Act.
XXXXXXXXXXX MAIN STREET FUNDS, INC.
By: ________________________
Xxxxxx X. Xxxx, Vice President and
Secretary
OPPENHEIMERFUNDS, INC.
By: _________________________
Xxxx X. Xxxxxx
Chairman, President & Chief Executive
Officer
